PROJECT SUMMARY/ABSTRACT Medicare beneficiaries also eligible for Medicaid - the duals - are a heterogeneous, vulnerable, high-cost, high-priority group. Duals are on average sicker than Medicare beneficiaries not eligible for Medicaid, often with multiple chronic conditions. Conflicting regulations and incentives between Medicare and Medicaid fragment care, reduce quality, and increase total spending. With their complex needs, dually eligible individuals are especially likely to benefit from coordinated care, yet this group is less likely than other Medicare beneficiaries to enroll in coordinated care plans. The juxtaposition of high need and cost, an inefficient Medicare/Medicaid partnership, and overreliance on fragmented care models creates an opportunity for policy to both improve care and economize on public funds. Eight states have signed a memorandum of agreement with CMS, and one state (Massachusetts) has already launched its demonstration. A fundamental and innovative feature of the new state models for duals is a restructured choice environment, in which a dual beneficiary must opt-out of a coordinated care plan rather than, as now, opt-in. Project 4 focusses on the supply, demand, and normative properties of this design choice inspired by findings in behavioral economics. Using national data and data from three selected states (California, Illinois and Massachusetts) we study supply by plans in the two regimes, including examining plan decisions about supplemental benefits. We also compare choices by dual beneficiaries in the opt-in and opt-out environments, assessing the relative importance of standard choice variables and factors that may be associated with cognitive errors. Finally, we apply theory-based assessments of the functioning of the opt-in versus opt-out choice environments, drawing on research from behavioral economics, public finance and health insurance markets.